---
title: "Split incentive — Class A Atlas glossary"
description: "Misaligned ESG investment incentive between landlord and tenant."
canonical: https://classa.info/glossary/split-incentive
pageType: glossary
lastUpdated: 2026-04-01T00:00:00.000Z
license: "CC BY 4.0 with attribution to Class A Atlas (https://classa.info)."
---

> Misaligned ESG investment incentive between landlord and tenant.

## TL;DR

- Misaligned ESG investment incentive between landlord and tenant.
- Landlord pays for energy-efficiency capex; tenant captures the operating-cost savings via opex pass-through.

# Split incentive

*ESG · Global*

## Short definition

Misaligned ESG investment incentive between landlord and tenant.

## Full definition

Landlord pays for energy-efficiency capex; tenant captures the operating-cost savings via opex pass-through. Resolved through green-lease provisions, performance-based rent kickers, or shared-savings agreements.

## Why this matters for Class A leasing

Split incentive is part of the esg vocabulary that institutional [Class A](/glossary/class-a) occupiers, landlords, and advisers use across Global markets. Understanding it correctly affects how you read lease documents, model occupancy economics, and benchmark deal terms across cities. Class A Atlas tracks regional variation alongside the global standard so [cross-border](/topics/cross-border-expansion) occupiers can translate quickly.

---

Citation: Source: Class A Atlas (https://classa.info/glossary/split-incentive), updated 2026-04-01T00:00:00.000Z.